Required:

The graph displays, for more than $148,000$ company$-$years, each company's net income divided by total stockholders' equity. By what name is this ratio known?

Select the statement that appropriately explains why the graph suggests evidence of earnings management.

Using the filter options in the upper right corner of the Tableau dashboard, select the "pre$-$SOX" years $($i$.$e$.,1985-2001)$ to alter the graph to show the number of companies reporting ratios prior to the implementation of SOX.

a$.$ How many companies reported a ratio near zero $($red bar$)$ in the pre$-$SOX period?

b$.$ How many companies reported a ratio near $-0\mathrm{.}015$ in the pre$-$SOX period?

c$.$ How many companies reported a ratio near $+0\mathrm{.}015$ in the pre$-$SOX period?

d$.$ Divide your answer in $3a$ by the total of your answers to $3a-3c.$ What fraction of the companies in $3a-3c$ reported a ratio near zero $($red bar$)?$

Using the filter options in the upper right corner of the Tableau dashboard, select the "post$-$SOX" years $($i$.$e$.,2003-2017)$ to alter the graph to show the number of companies reporting ratios after the implementation of SOX.

a$.$ How many companies reported a ratio near zero $($red bar$)$ in the post$-$SOX period?

b$.$ How many companies reported a ratio near $-0\mathrm{.}015$ in the post$-$SOX period?

c$.$ How many companies reported a ratio near $+0\mathrm{.}015$ in the post$-$SOX period?

d$.$ Divide your answer in $4$ a by the total of your answers to $4a-4c.$ What fraction of the companies in $4a-4c$ reported a ratio near zero $($red bar$)?$

e$.$ Do your answers in $3$d and $4$d suggest SOX encouraged a greater proportion of companies to honestly report near$-$zero earnings?

Complete this question by entering your answers in the tabs below.

Required $1$

Required $3$

Required $4$

Using the filter options in the upper right corner of the Tableau dashboard, select the "pre$-$SOX" years $($i$.$e$.,1985-2001)$ to alter the graph to show the number of companies reporting ratios prior to the implementation of SOX.

Note: Round "Fraction of the companies" answer to $3$ decimal places.

a$.$ Number of companies reported ratio near zero $($red bar$)$ in the pre$-$SOX period

b$.$ Number of companies reported ratio near $-0\mathrm{.}015$ in the pre$-$SOX period $$

c$.$ Number of companies reported ratio near $+0\mathrm{.}015$ in the pre$-$SOX period

d$.$ Fraction of the companies reported ratio near zero $($red bar$)$